Central Banks

If We Don’t Change the Way Money Is Created, Rising Inequality and Social Disorder Are Inevitable

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moneyCharles Hugh Smith – History informs us that rising wealth and income inequality generate social disorder.

Centrally issued money optimizes inequality, monopoly, cronyism, stagnation and systemic instability.

Everyone who wants to reduce wealth and income inequality with more regulations and taxes is missing the key dynamic: central banks’ monopoly on creating and issuing money widens wealth inequality, as those with access to newly issued money can always outbid the rest of us to buy the engines of wealth creation.

Access to low-cost credit issued by central banks creates financial and political power. Those with access to low-cost credit have a monopoly as valuable as the one to create money.

I explain why in my book A Radically Beneficial World: Automation, Technology and Creating Jobs for All.

Compare the limited power of an individual with cash and the enormous power of unlimited cheap credit.

Let’s say an individual has saved $100,000 in cash. He keeps the money in the bank, which pays him less than 1% interest. Rather than earn this low rate, he decides to loan the cash to an individual who wants to buy a rental home at 4% interest.

There’s a tradeoff to earn this higher rate of interest: the saver has to accept the risk that the borrower might default on the loan, and that the home will not be worth the $100,000 the borrower owes.

The bank, on the other hand, can perform magic with the $100,000 they obtain from the central bank. The bank can issue 19 times this amount in new loans—in effect, creating $1,900,000 in new money out of thin air. Continue reading →

Nomi Prins Explains The Central Bankers’ Game of Thrones [Video]

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James Corbett – Today James talks to Nomi Prins, author of books like All The Presidents Bankers, about her recent article “The Central Bank Power Shift from West to East, Game of Thrones Style.”

We talk about the changing economic and monetary landscape and how the locus of central bank power is shifting to the East, with players like the People’s Bank of China gaining in prominence and former US/EU lapdogs like the IMF becoming brokers for these new power players in the new world financial order.

SF Source Activist Post Nov. 2016

Stock & Bond Bubbles Much Worse Than 1929

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StockmanGreg Hunter – Economic expert and best-selling author David Stockman offers a dire view of the deep financial trouble America faces in his new book titled “Trumped!”

Stockman warns, “I think we are on the very edge, but what is different this time and makes it scarier . . . is I believe the central banks that ruled the roost have gone from one extreme to the next and done unfathomable things like negative interest rates on $13 trillion of bonds around the world, monetization of the debt, and bond purchases that are staggering such as $90 billion a month in Europe.

http://youtu.be/oyG7dqpU22Q

So, this time, as the phrase goes, they went all in.  They have violated every principle of sound money and sustainable finance that mankind has ever learned about over many centuries.  They have taken us to the edge, but they are out of dry powder.

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Catastrophic Bond Market Collapse Approaches [w/ Video]

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PentoGreg Hunter – Money manager Michael Pento wrote a book a few years ago warning of “The Coming Bond Market Collapse.” All the signs say this calamity is very close. Pento explains, “Global central bank balance sheets have risen from $6 trillion in 2007 to $21 trillion today. That’s the increase in the size of central bank balance sheets. . . .

I can prove to you when this bubble breaks, it’s going to be disastrous. . . . Just that they (European Central Bank-ECB) didn’t hint at expanding QE and look at what it has rendered us. That’s proof positive that everything that has happened since the 2008 collapse, that it’s just been artificial and ephemeral in nature. Once central banks even hint at pulling back from their QE programs and ZIRP and NERP go away, bonds will crash, and when those sovereign bonds crash on a global basis, it’s going to take everything else down with it concurrently.”

http://youtu.be/BhTl4f10t3g

What happens if the Fed raises interest rates, and what happens if it doesn’t? Pento contends, “If the Fed actually raises rates in this September meeting, I think what you saw last week and what you are experiencing this week is just the warm-up act. You are going to have a wipeout in bonds. Everybody is going to be rushing for the door at the same time, and there is no room but for one out of a thousand to get through. So, it’s going to be catastrophic.”

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Globalist’s Biggest Scam – Fiat Currency. It’s Debt Not Money

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Michael Noonan – Last week, in “Fiat ‘Dollar’ Says Gold And Silver Will Struggle,” we said the following [See 4th paragraph]:

Money does not exist in this country.  In fact, money does not exist anywhere in the world. What is money?  So few people know, and many who profess to know do not. Money is a commodity with a recognized value.  Gold and silver remain the last known standard of real money.  Remember J P Morgan’s famous words:  “Gold is money.  Everything else is credit.”

The globalists, through their creation of the Federal Reserve, have sold the biggest lie ever to the world and continue to get away with it.  People everywhere believe the fiat-created Federal Reserve Note, falsely called the “dollar,” is actually a monetary dollar.  We have often stated how Federal Reserve Notes are evidences of debt issued by the Fed.  We also always add that debt is not and can never be money, yet almost every American wrongly believes debt is money because they believe the Fed “dollar” is money.

Only gold and silver are money!

Gold and silver each are a commodity.  They have universal recognition and acceptance.  Their value is determined by the market by what people choose to accept as payment for goods and services offered.  By contrast, the Fed “dollar” is not money.  It is a currency.  A currency represents the actual money.  In today’s world, there is no currency that represents actual money.  Fiat is imaginary.  It does not exist except in one’s mind.  Yet, around the world, everyone’s imagination believes their local currency is money.

Only gold and silver are money!

If you go to a restaurant and use valet parking, you receive a stub to reclaim your car by the valet at the end of dinner.  The ticket stub is not the car, it represents the car to be “redeemed” upon presentation.  There is no currency in the world that represents money, and no currency can be redeemed for money.  Always remember, Only gold and silver are money! 

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